Tourism at Fujairah takes holiday

The hotels and shops along Al Aqah beach are less crowded these days as the economic slowdown takes its toll among sunseekers, particularly the long-distance travellers from Europe and elsewhere, and competition grows

FUJAIRAH, UNITED ARAB EMIRATES - JUNE 2: Fruit vendors at their stalls in the small village of Sharm in Fujairah on June 2, 2010. (Randi Sokoloff / The National) For Business story by Armina/Rebecca and/or stock
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Twenty-five years ago, Joseph Aboudib opened the Sandy Beach Motel as an isolated little resort with just 20 chalets on the Fujairah coast on the Gulf of Oman. Years later, the big international brands have followed and Le Meridien and Iberotel properties are now nearby along the Al Aqah beach, set against the backdrop of the Hajar Mountains.

"We were the first here," says Mr Aboudib, the general manager of the Sandy Beach, showing an old photograph of the property flanked by an empty coastline. "We're not in competition with the other hotels. When they opened, we benefited because Fujairah became well-known." The Sandy Beach Hotel and Resortnow has almost 100 rooms and chalets, along with restaurants and a diving centre as tourism to the emirate has grown, although the resort remains a relatively low-key property compared with some of its neighbours.

But after being able to demand soaring prices during better economic times, the hotels in Fujairah have seen room rates fall by up to 40 per cent from peak levels as tourists worldwide tightened their purse strings. "It is still difficult," says Christian Rainalter, the general manager of the JAL Fujairah Resort and Spa. "Up to two years ago it really was a seller's market. Now it is a buyer's market. Obviously where we see the big difference is with the international traveller."

Fujairah has become a popular destination among expatriates from the region as well as tourists from Europe, with business thriving every weekend, although the weekdays are far slower. "What we see here is that we're doing quite well with the local market. A lot of local families from Dubai and Abu Dhabi come down especially for the weekend, so weekend business has been always good," says Mr Rainalter.

With less wealth than some of the other emirates, Fujairah's commercial tourism development has been relatively restrained. Le Meridien Al Aqah Beach Resort, which opened in 2002, was the first five-star modern resort to open in the area that has become popular for its diving sites and scenery. Since then, other luxury properties have sprung up nearby, including the Miramar Iberotel and the Rotana properties. After that, however, the pace of development was hit by the financial crisis and no luxury hotels have opened on Fujairah's coast since 2007.

The efforts to promote the destination are also taking some time, with Fujairah authorities still planning their strategy. "The Fujairah tourism board has been in the launch stage for the past year," says Patrick Antaki, the general manager of Le Meridien Al Aqah and an adviser to the board for the hotel sector. "The tourism board is a new body and it has just started its work. There's a lot of background work and it's going to take a little while to get going. We're still preparing a plan or a strategy for the government to tell them what we need.

"When you're looking at a 10-year forecast or development, it takes a while to get everything sorted out. "Broadly speaking, we are looking at developing more resort tourism and tourism for people who are interested in visiting antiquities and monuments." For now, most tourists drive to Fujairah from Dubai or Abu Dhabi. There is talk in the industry that a charter flight from Germany to Fujairah might start at the end of the year.

Mr Rainalter agrees the emirate had yet to maximise its potential as a tourism destination. "Fujairah as a destination needs a little bit more marketing. It's about the beauty of the area. A lot of people prefer this area of the UAE because it feels like you are somewhere that is natural." Fujairah's location on the east coast of the UAE means its generally a few degrees cooler than other parts of the country, but the summers are still often uncomfortably hot, leading to a slower season.

The change is clear at other Fujairah attractions. Al Bidiya Mosque, the UAE's oldest house of worship still in regular use, has welcomed fewer visitors. Badria Shreef, the supervisor at the mosque that is more than five-and-a-half centuries old, estimated that about 150 people would visit each week in May last year, compared with the 100 to 130 visitors a week last month. There were fewer international visitors this year, she says. "We have lots of internal visitors, emirate to emirate, but not from outside."

Hoteliers in Fujairah say their business is being slowed by competition from near and far. "The additional properties coming in Dubai and Abu Dhabi are affecting us," says Mrad el Khoury, the general manager of the Rotana Resort and Spa. "Now there's destination competition. It's not like before." Satish Gujaran, the front office manager of the Sandy Beach Hotel, says many of its regulars are families from the Emirates, many of whom travel abroad during the hottest months of the year.

"We don't expect much for the summer," he says. Currency fluctuations are also a concern for the international hotel chains, which are popular among tourists from Europe. "If the euro continues to go down, we will be affected during the summer as well because their purchasing power is going to go down so we'll probably have to reduce our rates to attract the customer," says Mr Antaki. Other businesses are feeling the pinch in Fujairah. Yasin Fazlie, the area manager of Golden City, which operates souvenir shops across the UAE including at Le Meridien Al Aqah and the Miramar Hotel, says sales are steady but people are seeking lower prices.

Sales are slightly higher than last year, but are still well down from those of 2008, before the onset of the economic downturn, he adds. "More people are buying cheaper items," Mr Fazlie says. "Before we used to sell a lot of Iranian handicrafts, which cost around Dh500, Dh600 ? Now, people look at the prices before going for it. They will go for the cheap item, for Dh25, Dh50." Hotels have also responded to tourists' thriftier habits.

Mr Antaki says Le Meridien's restaurants reduced the menu prices by between 25 and 30 per cent to stimulate lagging demand. "All the customers are asking for value for money now," he says. "They don't necessarily want cheap. They want value for money. Everybody is offering deals and everybody is offering special offers. "There is a general reduction in price and people work harder today for their pound, or their dollar or their dirham."

The times are also leaner for the small produce and souvenirshops near the resorts. Mohammed Imran Khan, a salesman at Rashed Saeed Hamed Vegetable shop, said business had slowed significantly since last year. "In 2009, there were many people and fruit sales. In 2010, there is no business." But Mr Aboudib remains as optimistic about the future of Fujairah as he was a quarter of a century ago. He hopes to start work at the end of this summer on 50 new rooms for the Sandy Beach, an expansion that was put off last year during the financial crisis.